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Jagdipik Rai and Rimppi Rai v. Gmac Mortgage

January 31, 2011


The opinion of the court was delivered by: Lucy H. Koh United States District Judge


(re: docket #12)

United States District Court For the Northern District of Califo U.S.C. §§ 1601 et seq. and various state law claims in connection with the non-judicial foreclosure 19 of property located at 6447 Hyde Park Drive, Gilroy, California (the "Property"). The Court has 20 previously denied Plaintiffs' two motions for temporary restraining orders for failure to comply 21 with the notice requirements of the Federal Rules of Civil Procedure and failure to establish a 22 likelihood of success on the merits. The Court has also granted Plaintiffs' request to electronically 23 file and serve their documents on the Court's Electronic Case Filing (ECF) system based on Plaintiffs representations that they now reside in Surrey, British Columbia, Canada. Presently 25 before the Court is Defendant's Motion to Dismiss. Plaintiffs did not file an Opposition. The Court finds this matter appropriate for resolution without oral argument. See Civ. L.R. 7-1(b). For Plaintiffs Jagdipik and Rimppi Rai ("Plaintiffs"), proceeding pro se, bring suit against GMAC Mortgage ("Defendant") alleging violation of the Truth in Lending Act ("TILA"), the reasons described below, Defendant's Motion to Dismiss is GRANTED in part with leave to amend and in part with prejudice.

Plaintiffs' Complaint. The thirty-two page Complaint consists mostly of generalized allegations against "unscrupulous lenders" and the entire "mortgage system itself." See, e.g.,Compl. at Complaint also refers to "Defendants," although Plaintiffs have only named a single Defendant (GMAC Mortgage) -- an entity about which Plaintiffs fail to make any specific claims. The only specific factual information in the Complaint relates to the origination of a loan on the Property:

Plaintiffs allege they "entered into a consumer contract for the refinance of a primary residence located at 6447 Hyde Park Dr. Gilroy CA 95020," id. at 1 (spacing as in original) and, later in the Complaint, provide a "listing of the fees charged at settlement." See id. at 15. Plaintiffs do not 16 identify the lender, the loan amount, or the date of the loan transaction. Beginning on page 25 of the Complaint, Plaintiffs allege six causes of action: (1) breach of fiduciary duty; (2) negligence 18 and negligence per se; (3) fraud; (4) breach of implied covenant of good faith and fair dealing; (5) violation of TILA; and (6) intentional infliction of emotional distress. Plaintiffs' Complaint 20 concludes with a prayer of relief for, inter alia, rescission, compensatory damages in the amount of $503,890.80, punitive damages in the amount of $1,511,672.40, and pain and suffering in an 22 unspecified amount. Id. at 30-31. judicially noticeable facts. See Def.'s Mot. to Dismiss at 2.*fn1 On July 31, 2008, Plaintiffs obtained


A.Plaintiffs' Complaint

Plaintiffs, who are now apparently residing in Surrey, British Columbia, Canada, filed an "Original Petition" on September 22, 2010. The Court will refer to this "Original Petition" as (discussing the general state of the real estate industry and the "best of intentions"). The nia r

United States District Court For the Northern District of Califo

B.Defendant's Motion to Dismiss and Request for Judicial Notice

Defendant submits that the following are the relevant allegations in the Complaint and a residential mortgage loan for $510,000 in connection with the Property. The loan was secured by 2 a Deed of Trust recorded on or about August 6, 2008 with the Santa Clara County Recorder's Trust identifies "Your Best Rate Financial, LLC" as the lender, "National Real Estate Information Services" as the trustee, "Mortgage Electronic Registration Systems, Inc. ("MERS") as the 6 beneficiary, and Plaintiffs as the borrowers. Plaintiffs defaulted on the loan, and a Notice of Default and Election to Sell Under Deed of Trust ("NOD") was recorded on or about June 9, 2010.

Plaintiffs' loan was $25,968.50. The NOD also notified Plaintiffs that no date of sale would be set 10 until three months from the NOD. A Notice of Trustee's Sale was recorded on September 9, 2010.

Office. See Def.'s Request for Judicial Notice ("RJN"), Exh. A. The August 6, 2008 Deed of

See Def.'s RJN, Exh. B. The NOD indicated that, as of June 7, 2010, the amount in arrears on

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See Def.'s RJN, Exh. C. According to that Notice, the Property would be auctioned off for sale on United States District Court

For the Northern District of Califo

October 5, 2010. In addition, the Notice of Trustee's Sale provided that the total amount of unpaid 13 balance and reasonable costs/expenses was $545,075.00.

Dismissal under Federal Rule of Civil Procedure 12(b)(6) for failure to state a claim is "proper only where there is no cognizable legal theory or an absence of sufficient facts alleged to 17 support a cognizable legal theory." Shroyer v. New Cingular Wireless Services, Inc., 606 F.3d 658, 18 664 (9th Cir. 2010) (quoting Navarro v. Block, 250 F.3d 729, 732 (9th Cir. 2001)). In considering 19 whether the complaint is sufficient to state a claim, the court must accept as true all of the factual 20 allegations contained in the complaint. Ashcroft v. Iqbal, 129 S. Ct. 1937, 1949 (2009). However, 21 the court need not accept as true "allegations that contradict matters properly subject to judicial 22 notice or by exhibit" or "allegations that are merely conclusory, unwarranted deductions of fact, or 23 unreasonable inferences." St. Clare v. Gilead Scis., Inc. (In re Gilead Scis. Sec. Litig.), 536 F.3d 1049, 1055 (9th Cir. 2008). While a complaint need not allege detailed factual allegations, it "must 25 contain sufficient factual matter, accepted as true, to "'state a claim to relief that is plausible on its 26 face.'" Iqbal, 129 S.Ct. at 1949 (quoting Bell Atlantic Corp. v. Twombly, 550 U.S. 544, 570 27


of Los Angeles, 250 F.3d 668, 688 (9th Cir. 2001) (courts may take judicial notice of matters of 28 public record).

(2007)). A claim is facially plausible when it "allows the court to draw the reasonable inference 2 that the defendant is liable for the misconduct alleged." Iqbal, 129 S.Ct. at 1949.

to grant leave to amend. "[A] district court should grant leave to amend even if no request to 5 amend the pleading was made, unless it determines that the pleading could not possibly be cured 6 by the allegation of other facts." Lopez v. Smith, 203 F.3d 1122, 1130 (9th Cir. 2000) (quoting Doe v. United States, 58 F.3d 494, 497 (9th Cir. 1995)).

absence of any specific claims against Defendant GMAC Mortgage and the absence of any factual If the Court concludes that the complaint should be dismissed, it must then decide whether


Defendant has moved to dismiss the Complaint on a number of grounds, including the

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allegations to support any of the claims. As noted above, Plaintiffs have not filed an Opposition.

United States District Court

For the Northern District of Califo

The Court finds that Plaintiffs' Complaint is fatally deficient in a number of respects, including 13 failure to satisfy the minimum pleading requirements of Federal Rule of Civil Procedure 8. Thus, the Court grants Defendant's Motion to Dismiss.

On December 11, 2010, Plaintiffs filed a motion for leave to file an amended complaint.

A.Plaintiffs' Untimely Motion for Leave to File an Amended Complaint See Dkt. #16. In that motion, Plaintiffs did not identify any new claims or supporting factual 18 allegations, but instead asked for leave to correct "technical and formatting errors," to make a more 19 concise TILA claim, and to add two Defendants (Your Best Rate Financial, LLC and MERS).

Defendant opposed the motion correctly noting that the period for leave to amend under Federal (a)(1)(A) (providing for amendment as a matter of course within "21 days after service of a 23 responsive pleading or 21 days within service of a motion under Rule 12(b), (e), or (f).").

Defendant also opposed the Court's granting leave to amend because even Plaintiffs' amended 25 complaint would not cure the serious deficiencies in the original complaint. proposed amended complaint are far more serious than mere "technical and formatting errors" or

Rule of Civil Procedure 15 as a matter of right had long since expired. See Fed. R. Civ.

The Court agrees with Defendant. The deficiencies in both the original Complaint and wordiness. The overarching problem is that Plaintiffs fail to allege any specific factual allegations 2 to support any claim against any Defendant, including the two Defendants they seek to add. 3

Moreover, Plaintiffs' understanding of the law is seriously flawed. Under these circumstances, 4 where Plaintiffs are representing themselves, and a motion to dismiss is pending, the Court finds 5 that dismissal of Plaintiffs' original Complaint with leave to amend is the more appropriate and 6 efficient route. Accordingly, Plaintiffs' motion for leave to file an amended complaint is DENIED 7 without prejudice. 8

9 after reviewing this Order. See, e.g., Gutierrez v. Wells Fargo Bank, 2009 U.S. Dist. LEXIS 38142 10

The Court offers the following discussion should Plaintiffs choose to amend their complaint

(N.D. Cal. Apr. 20, 2009) (adopting a similar approach in a foreclosure action involving a pro se

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plaintiff). Such an amended complaint may include Your Best Rate Financial, LLC and MERS as

United States District Court

For the Northern District of Califo

additional Defendants, but Plaintiffs must provide specific factual allegations for each element for 13 each of their claims, and must state with specificity to which Defendants each of their claims apply.

Failure to do so risks dismissal of this entire action with prejudice.

among other things, disclosure of finance charges and the annual ...

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